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USDCAD Tests Bear Trigger On Improved Risk Sentiment

  • A combination of broader USD weakness and higher oil prices sees USDCAD continue to test the near-term bear trigger of 1.2587, the post-invasion low from Mar 3.
  • Having earlier touched 1.2583, a clear break could open 1.2552, the 76.4% retracement of the Jan19-Feb24 rally, whilst resistance is seen at the 20-day EMA of 1.2723.
  • The broad improvement in risk sentiment has more than outweighed a more negative front-end Can-US yield differential as Tsys underperform GoCs on a larger pricing in of Fed hikes.
  • CFTC net specs had CAD net longs increase solidly with data up to Mar 15.

Source: Bloomberg

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